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Microsoft is cutting 4,800 jobs worldwide and launching what it describes as the biggest restructuring in Xbox’s history as the technology giant reshapes its business to adapt to a rapidly changing industry.
The move includes the immediate elimination of more than 1,600 positions at Xbox, with another 1,600 jobs set to be phased out over the next year.
In a memo to employees, Microsoft’s Executive Vice President Amy Coleman said the company must focus on areas that deliver the greatest value to customers as technology and market demands evolve.
“Companies don’t get to choose whether their industry changes; they only get to choose whether they change with it,” Coleman said.
She added that while the layoffs would not be replaced directly by artificial intelligence, AI is fundamentally changing how work is performed across the company.
Xbox Chief Executive Asha Sharma described the changes as “the most significant restructure in Xbox history,” saying the overhaul is aimed at securing the gaming division’s long-term future.
“These changes are about a bigger future for Xbox, not a smaller one,” Sharma said. “History is full of companies that mistake longevity for inevitability. We will not be one of them.”
As part of the restructuring, Microsoft will spin off four Xbox game development studios: Compulsion Games, Double Fine Productions, Ninja Theory and Undead Labs.
The latest cuts come as the global gaming industry continues to grapple with widespread job losses and restructuring. In 2024, Microsoft laid off more than 2,000 Xbox employees and closed four studios following its acquisition of Activision Blizzard, the maker of the Call of Duty franchise.
The new round of layoffs underscores Microsoft’s continued efforts to streamline operations while investing in emerging technologies, particularly artificial intelligence, amid intensifying competition across the technology sector. Source: BBC News